Zambia would not sell mining assets despite defaulting on $42.5m bond coupon

Richard Musukwa, mines minister, Zambia

ZAMBIA did not expect state-owned mining assets would be taken by bondholders despite defaulting on part of its debt last week, said Reuters citing the country’s mines minister, Richard Musukwa.

Musukwa also said his government had no intention of selling any mining assets. In fact, discussions with Glencore regarding increasing the government-owned ZCCM-Investment Holding’s stake in Mopani Copper Mines were nearing conclusion.

Zambia hoped to “strike a win-win situation” with bondholders, said Musukwa. His comments come after Africa’s second largest copper producer failed to pay the $42.5m coupon on its Eurobond debt last Friday.

Zambia’s mining assets have been in the spotlight as the country’s financial situation deteriorated this year and the Covid-19 pandemic prompted mining giant Glencore to shutter its Mopani Copper Mines, angering the government, said Reuters.

Reuters reported in August that Glencore had put its entire 73.1% stake in Mopani on the table in the talks with Zambia. ZCCM-IH holds 10% currently whilst First Quantum Minerals, a Toronto-listed firm, owns the balance of the shares.

Zambia produced 646,111 tons of copper between January and September 2020, up from 590,321 tons in the same period last year, Musukwa said, attributing the 9.45% rise to increased mine output.

Copper production for 2020 is expected to be 820,000 tons, Musukwa said.

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